Distraction off the pitch as Portsmouth FC heads to the high court.

Portsmouth Football Club has been given a week-long “stay of execution” by a judge at the High Court, after being given a winding-up order by Her Majesty’s Revenue and Customs (HMRC).

The Judge presiding over Portsmouth’s court hearing, Mrs Registrar Derrett, said: “I am very concerned about the financial status of this company. It seems to me there’s a very real risk that this company is undoubtedly trading while it is insolvent.

“I’m obviously conscious that, by making a winding-up order, it would have very severe consequences not only for the company as a business but for the supporters themselves, but that’s not a consideration that I strictly take into account.”

According to reports Portsmouth owes the HMRC a total of £7.4 million in unpaid VAT bills, as well as £4.7m in unpaid PAYE and National Insurance.

The club has had four different owners in just a year and more recently Balram Chanrai who seized control of the club from Ali al-Faraj by invoking a clause in a loan contract.

Nigel Hood, representing Portsmouth, said any move to wind up the club would have “serious consequences.”

“There would be irreparable harm caused not only to the suppliers but to the employees, 600 staff and people who have paid in advance for their season tickets would lose their money.”

If the South-coast club falls into administration and fails to find a new owner it will lose ten points in the league, almost certainly ensuring the club falls out of the Premier League at the end of the season.

Portsmouth is not the only Premier League football club in financial trouble. Newspapers have been reporting crisis talks at a number of the UK’s biggest clubs for some time now.

Liverpool Football Club has been the subject of speculation this week over a possible buy-out. One of India’s richest businessmen, Subrata Roy, is understood to be interested in buying the debt-ridden club.

Premier League winners Manchester United has also been slammed for its rising debts. Its parent company, Red Football Joint Venture Ltd, owned by the American Glazer Family, owes around £716.5m according to its latest accounts. The only profit returned on the business was from the sale of Cristiano Ronaldo last summer.
 
Lord Triesman, the Football Associations’ (FA) Chairman has long been critical of the size of debt in the English football league. In 2008, when total debts were estimated to be around £3 billion he launched a stinging attack on many of the biggest clubs and their owners.

The Chairman said that the “toxic debt” could cause irreparable damage to the game and he called for a more stringent screening process for potential new owners: “The fit and proper persons test does not do the job sufficiently robustly. A review is now inevitable because football clubs are not mere commodities. They are the abiding passion of their supporters. We forget that at our peril.”